A non-resident purchasing a vehicle in Massachusetts and taking delivery out-of-state is exempt from sales tax unless the vehicle is returned to Massachusetts within six months of purchase. The buyer should make sure to receive a valid out-of-state Letter of Delivery.
If the vehicle is returned to Massachusetts within six months of purchase, the use tax must be collected on the vehicle. If the state of delivery is reciprocal with Massachusetts, then the tax due to Massachusetts is 6.25% calculated on the purchase price subtracting the tax paid to the other state. If the state of delivery is not reciprocal with Massachusetts, the full Massachusetts use tax must be collected.
The following documents are required for this exemption:
• A Letter of Delivery
• Completed Form MVU-29
• Proof of tax paid to the state of delivery, if the vehicle was purchased less than six months ago